A financial analyst, Kalu Aja, has said that Nigeria’s challenge is not only about generating more revenue but also how the government spends the money it receives.

Aja, in an analysis shared on social media (X), said the Federal Government received a total of N20.4 trillion in incremental resources between June 2023 and December 2025.

Despite the additional resources, only N424 billion, representing about 2.1 percent, went to social welfare, according to figures attributed to the Federal Ministry of Finance’s reform scorecard.

Of the social welfare spending, education received N223 billion, representing just 1.1 percent of the total incremental resources.

The analysis showed that a significant portion of the funds went to wages and allowances, external debt servicing and infrastructure.

Wages and allowances accounted for N9.39 trillion, while N9.37 trillion was spent on servicing external debt. Infrastructure received N6.5 trillion.

Aja argued that the figures showed that increased government revenue had not necessarily translated into better spending priorities.

“More money = better choices,” he said, stressing that improved revenue must be matched with better prioritisation of public spending.

The figures highlight the pressure facing the government as it seeks to balance debt obligations, workers’ salaries, infrastructure needs and social spending. While higher government revenue provides more resources for development, the analysis suggests that the impact on ordinary Nigerians will depend largely on how those resources are allocated.

The argument also comes amid ongoing calls for the government to channel more funds into areas such as education, healthcare, social protection and other programmes that directly improve living conditions.

According to the analysis, the large amounts committed to wages, allowances and debt servicing leave less room for social welfare programmes, despite the government’s increased financial resources.

Aja’s position is that Nigeria’s fiscal challenge should therefore be viewed from both sides of the equation: the country needs to raise more revenue, but it must also ensure that available funds are directed towards the areas with the greatest economic and social impact.

However, the N20.4 trillion was not entirely generated from subsidy savings.

According to the Federal Ministry of Finance’s Reform Scorecard, the Federal Government’s incremental resources comprised N5.43 trillion from its share of subsidy savings, N3.12 trillion in other incremental revenue and N11.85 trillion in additional borrowing. Borrowing therefore accounted for about 58 percent of the additional resources.

The ministry also said the N15.8 trillion saved from subsidy reforms between June 2023 and December 2025 was not retained solely by the Federal Government.

Of the amount, N5.43 trillion accrued to the Federal Government, while N6.52 trillion went to states and N3.88 trillion to local governments.

Overall, the Federal Government recorded N30.64 trillion in incremental expenditure during the period, about N10.24 trillion more than the N20.4 trillion in incremental resources. The ministry said the gap was partly absorbed by the government’s existing revenue base.

The government’s social-welfare spending included N223.8 billion for NELFUND to support tertiary education, N150 billion for the MOFI Real Estate Investment Fund to support affordable housing finance and N50 billion for CREDICORP to expand access to consumer credit.

Defending the broader reform programme, Finance Minister and Coordinating Minister of the Economy, Taiwo Oyedele, said the government had also prevented deeper fiscal and economic problems. He noted that 27 states that could not reliably pay salaries in May 2023 had been reduced to zero.

However, Oyedele acknowledged that the reforms had imposed significant costs on Nigerians, including the rise in petrol prices from about N185 per litre to between N1,100 and N1,400, as well as higher interest rates. He said the Monetary Policy Rate rose from 18.5 percent to 26.5 percent during the period.

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